Financial Independence Abroad: Braga, Portugal

A shortcut to financial independence is cutting your costs (drastically). Easier said than done of course, but for those of us who live in (relative) expensive countries, moving to a cheaper place may be a way to achieve it. In the post series ‘Financial Independence Abroad’ I will put my investigative hat on and look at a city/country that I find promising. My main questions are: Can I see myself living there? And how would moving there impact my journey to financial independence?

In this second installment: Braga, Portugal (first post was about Cluj, Romania).

Let me start with a confession: I have never been in Braga. Not even close as I have never even visited Portugal. I decided to write about this place anyway as I have only heard good things about it and want to see whether the city could make it to my list with potential future FIRE destinations.

And I am not entirely clueless. I have a few Portuguese acquaintances who have told me quite a bit about their country.

Braga is located in the far north of Portugal, northeast of Porto, in the historical Minho province.

Portugal shares the Iberian peninsula with Spain, in the south-west corner of southern Europe. It’s a country with rich culture, wonderful cities and beautiful nature. It used to be one of the poorer place in Western Europe, but after the end of the dictatorship in 1974 and its incorporation into the EU in 1986, their economic fortunes have changed for the good.

The country is relatively small, but extremely diverse. In a single day you can experience a bit of everything. From green mountains (covered with vines and trees) in the North to rocky mountains, with spectacular slopes and falls in central regions, to a near-desert landscape in the Alentejo region and finally to the beach holiday destination Algarve.

I love nature, so the country’s natural diversity is in and of itself a good reason for me to visit. I’ve traveled a lot in my life thus far, but I’ve always prioritized other destinations over Portugal (well sometimes there was nothing to prioritize as my travels were mere business trips). But there’s still time to make up for that ‘mistake’.

Those of you who don’t know where Portugal is, try to locate it on the map of Europe shown below.

Braga

As mentioned, I have never been in Portugal so I do not have any firsthand impressions I can share. However, I talked to my Portuguese acquaintances and asked them to tell me a bit about Braga and surroundings. This is what one of them said (and I quote):

First of all, Benfica is the best team in the entire world and the the biggest in Portugal. But I am also a fan of Sporting Club de Braga (they are called the Benfica of the north) so there it is: Your first introduction to the city of Braga. They have the most awesome stadium you can imagine. It is built entirely in the middle of a rock. It’s awesome!

Okay this shows the passion of the Portuguese people I guess (in particular for football). They answer any question (even about stock markets) by first referencing their favorite football club. Well, that’s an overstatement of course, but the Portuguese people I know are very passionate about football. You’ll never be in doubt what team they support.

Let’s go back to the answer.

I’m not a native (I was born and I live in Porto) but I work in Braga since late 2005. I don’t go the city center very often, but I know it and I know the surroundings of the city.

Braga is a really young city because it has a big and well-known university that gathers students from the entire country. That’s good because the night life is really cool (a lot of new bars, tapas restaurants and other cosy places). It’s a little bit hipster in some cases but there is a lot of diversity.

Okay that is indeed cool. I really like the young, vibrant and international atmosphere that a university gives to a city.

It’s also a very old city (the oldest in the country). This brings a lot of history to the city center: Beautiful old corners, huge churches and plenty of old coffee places. And you know what, we also have a Nanotechnology center (the only one in the Iberia Peninsula). So, it’s modernity and ancient history in perfect harmony.

Google confirms the message that Braga is indeed an old and beautiful city. It has wonderful squares with statues and fountains, narrow cobblestone streets and plenty of majestic buildings that witness of past prosperity. For me that’s important. I wouldn’t want to emigrate to a place that lacks the historical dimension.

Close to Braga you have a natural reserve where you can fish, bath, walk, hike and not the least: Breathe fresh air. It’s called Gerês and it’s huge!

It looks like an awesome natural reserve indeed.

You also have Guimarães (the birth place of Portugal) – and the biggest enemy of Braga football club fans. This city is also very beautiful.

Football again.

And being in Braga, you are only one step away from Porto (the most beautiful city in the country and the best European travel destination for years and that’s not only me, the native, talking). Porto is only 40 km from Braga.

And finally, you are even closer to Spain! One hour drive and you are in Vigo.

My acquaintance has a good point here. Portugal is a small country and there are other wonderful cities nearby – Guimarães and Porto being some of the closest. And as you can see, Porto should be worth a visit (well, probably multiple visits).

And then there is Spain. You can easily reach Santiago de Compostela for example, which is the capital of northwest Spain’s Galicia region and known as the culmination of the Camino de Santiago pilgrimage route.

Braga is also one of the best places to live due to the quality/cost balance. Being a city of the interior, the price levels for almost everything are lower than in the rest of the country. So i think that, even if you want to rent a house or a bedroom for a couple of months, you have plenty of choices. As an alternative, you have B&B’s, hostels and some really cheap hotels.

You also have great food by the way: Try the Bacalhau á Braga, Papas de Sarrabulho, Pudim Abade de Priscos.

What is there not to like about Braga?

The People

This is the trickiest part of my post.

I haven’t met Portuguese people in Portugal (for the very simple reason that I have never been there), but I’ve run into a few Portuguese expats over the years. Without exception they were nice and friendly. Never arrogant. Quite the opposite I would say. They are very loud and passionate when it comes to football (as you have seen), but they’re much quieter in general.

Feel free to comment on this by the way. What experiences do you have? And in case you are Portuguese, how would you describe yourself?

Cost of living

According to the website expatistan.com Braga has a cost of living index of 99. This means it is 1% cheaper than the reference city (which happens to be Prague).

Compared to New York, London, Amsterdam and where I live, however, the cost of living is around 50% lower. Below you can see the differences per category:

That’s significantly cheaper in all categories (especially housing). If we use the rule of thumb that housing costs should not exceed 30% of your total budget, then a monthly budget of around $1800 would be more than sufficient (as you can rent a decent 1 bedroom apartment in the center for $600).

If you are willing to live outside the center, you can find cheaper places obviously. A 1-bedroom apartment for $400-$450 should be possible. In that case a budget of $1300-$1400 should be sufficient.

I’ve asked my acquaintance in Portugal and she confirmed that these amounts are close to the truth.

Cost of coffee (CoC)

One thing I forgot to mention: Drinking coffee in Portugal is a part of life, with cafés on almost every street corner (the most common drink is espresso).

In Braga you can get a cappuccino for a little more than $2. More than 60% cheaper compared to what I pay in my hometown.

Also, a dinner for two at an Italian restaurant, including appetizers, main course, wine and desert would cost you $35.

Inflation

Inflation in Portugal is low and pretty much following EU averages.

Climate

The climate in Braga is warm and temperate. It can get quite hot in the summer – hotter than the coastal places (due to the distance to the ocean). Summers are dry, but do expect a fair share of rain in the autumn and winter months.

It is never going to be very cold, but during wintertime the nightly temperatures can drop below zero degrees Celcius (32 Fahrenheit).

Snow is rare, although you can expect snow in higher altitudes. But be prepared. In the event it does snow, it is likely to cause significant chaos on the roads. Suffice to say that if you’re a snow lover then Portugal isn’t really the place for you (although they do have a ski resort: Serra da Estrela, about 300 km east of Lisbon).

It doesn’t snow often, but when it does it looks wonderful – Bom Jesus in Braga

Healthcare

In general, public healthcare is of good quality but there are challenges as there is quite some strain on the system, which could cause long waiting lists.

If you are a European Union national you are most likely entitled to public healthcare (European Health Insurance Card). This also applies if you are a pensioner from another EU state, but now live in Portugal. However, if you retire before qualifying for state pension (that’s the plan right?) you only qualify for temporary cover. When this expires you would either need to make voluntary social security contributions or get a private health insurance.

All non-European Union nationals must apply for private insurance in order to obtain medical treatment in Portugal.

Health insurance is a complicated topic, but I will most certainly dedicate one or more posts to this in the future as it is important and can have quite a significant impact on the required budget.

Crime

Portugal is generally safe. It is NOT a dangerous country to live in. The best way to get this message across is present some statistics. Let us compare Braga with London for example.

Topic

London

Braga

Level of crime

High

Low

Crime increasing in the past 3 years

High

Moderate

Worries home broken and things stolen

Moderate

Low

Worries being mugged or robbed

Moderate

Low

Worries car stolen

Moderate

Moderate

Safety walking alone during daylight

High

Very High

Safety walking alone during night

Moderate

High

The list is much longer, including aspects such as violent crime, people dealing drugs, etc. But the pattern is the same. Braga is the safer place to live compared to London.

The exception is the topic ‘problem with corruption and bribery’. Here the concern is low for London and moderate for Braga. I don’t believe that this has a big impact on daily life however.

Conclusion

Braga looks like a wonderful place to me. The city is youthful, vibrant, historic. It’s not a big city by any means (less than 200.000), but I think it has a lot to offer. As a backup, remember that Porto is only a stone’s throw away (and Guimarães to name another city).

The cost of living is significantly lower than where I live, which would allow me to retire much earlier were I to decide to move to Braga. How much earlier depends on the required budget, which in turn also depends on whether I would rely on public healthcare or not. But an annual budget just below $30K per year should be sufficient.

Anyway, next point on the agenda is visit Braga in real life and see the place with my own eyes.

What do you think?

Do you consider cutting costs by moving to a cheaper place?

Would you ever consider emigration to achieve financial independence earlier?